Opening Prices:
> WTI is down 38c to $42.51/Bbl, and Brent is down 38c to $45.08/Bbl.
> Natural gas is down 3.4c to $2.383/MMBtu.
OPEC+ meeting today. EIA Petroleum Report at 9:30 AM CT.
Oil & Gas Prices - Aug 19
Oil & Gas Prices - Aug 19
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Aug 19
Energy Stocks Ripping Higher
Christian DeHaemer
Written Aug 18, 2020
"We here at Energy and Capital are bullish on the price of oil, predicting that oil will move into the low $50s over the next three months. As I write this, oil is in contango, which means that contracts are priced higher a few months out than they are today. There is a lot of oil in storage and this is getting worked off. However, demand is rising at the same time that supply is shrinking. COVID-19 has gutted long-term supply growth by stopping exploration and canceling greenfield projects. It’s all about capex, and banks, which are faced with failing loans to oil companies, won't spend more money on new projects. That being said, those oil companies that are profitable with strong balance sheets are doing extremely well."
Christian DeHaemer
Written Aug 18, 2020
"We here at Energy and Capital are bullish on the price of oil, predicting that oil will move into the low $50s over the next three months. As I write this, oil is in contango, which means that contracts are priced higher a few months out than they are today. There is a lot of oil in storage and this is getting worked off. However, demand is rising at the same time that supply is shrinking. COVID-19 has gutted long-term supply growth by stopping exploration and canceling greenfield projects. It’s all about capex, and banks, which are faced with failing loans to oil companies, won't spend more money on new projects. That being said, those oil companies that are profitable with strong balance sheets are doing extremely well."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Aug 19
Bank of America: Oil to hit $60. Bank of America expects oil prices to recover to $60 a barrel for Brent crude in the first half of next year thanks to shrinking global inventories and prices improving faster than previously expected.
OPEC compliance hit 95% in July. OPEC compliance with the production cuts reached 95 percent in July. Also, Nigeria and Iraq are expected to cut their production by another 114,000 and 400,000 bpd, respectively, in August and September to compensate for lagging performance in prior months. The success of the deal is notable. “However, in reality, they are likely concerned that it is taking longer for storages to see some material level relief, while the price recovery the alliance was hoping for is also pushed further in time due to the pandemic’s persistence,” Rystad Energy said in a statement.
At the DUG Conference on Tuesday, Marshall Atkins (head of Raymond James Energy Sector Team) predicted that WTI will be over $50 by December, 2020 and in the $80s sometime in 2H 2021, primarily because global crude inventories are now declining by more than 2 million bbls per day and the rate of decline will accelerate as global economy moves back to "normal". Raymond James forecasts demand for oil based products will get back to 98 million barrels per day in 2021 vs 101 million bpd in 2019. U.S. oil production will fall to 9 million bopd and will be slow to recover because we need 800 active drilling rigs to get any growth.
OPEC compliance hit 95% in July. OPEC compliance with the production cuts reached 95 percent in July. Also, Nigeria and Iraq are expected to cut their production by another 114,000 and 400,000 bpd, respectively, in August and September to compensate for lagging performance in prior months. The success of the deal is notable. “However, in reality, they are likely concerned that it is taking longer for storages to see some material level relief, while the price recovery the alliance was hoping for is also pushed further in time due to the pandemic’s persistence,” Rystad Energy said in a statement.
At the DUG Conference on Tuesday, Marshall Atkins (head of Raymond James Energy Sector Team) predicted that WTI will be over $50 by December, 2020 and in the $80s sometime in 2H 2021, primarily because global crude inventories are now declining by more than 2 million bbls per day and the rate of decline will accelerate as global economy moves back to "normal". Raymond James forecasts demand for oil based products will get back to 98 million barrels per day in 2021 vs 101 million bpd in 2019. U.S. oil production will fall to 9 million bopd and will be slow to recover because we need 800 active drilling rigs to get any growth.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Aug 19
Closing Prices:
> WTI prompt month (SEP 20) was up $0.04 on the day, to settle at $42.93/Bbl.
> NG prompt month (SEP 20) was up $0.009 on the day, to settle at $2.426/MMBtu < The December 2020 NYMEX contract is now $3.15
> WTI prompt month (SEP 20) was up $0.04 on the day, to settle at $42.93/Bbl.
> NG prompt month (SEP 20) was up $0.009 on the day, to settle at $2.426/MMBtu < The December 2020 NYMEX contract is now $3.15
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group